Lynchburg homeowners pay zero property tax on qualifying home solar panels. Under the Virginia solar property tax exemption in Va. Code § 58.1-3661(A), a home system rated 25 kW DC or less is wholly exempt from state and local property tax. Your Lynchburg tax bill stays the same after your panels go up. The exemption is mandatory statewide, lasts for the life of the system, and covers the solar equipment itself.
This guide walks through who qualifies and how Lynchburg’s older solar ordinance fits in. We also show how to confirm your status with the city and what the exemption is worth in dollars. Finally, we cover how it pairs with Appalachian Power net metering in 2026.
Key Takeaways
- Home solar systems rated 25 kW DC or less are wholly exempt from property tax in Virginia.
- The exemption applies to every Virginia locality, including Lynchburg.
- It lasts for the life of a qualifying system, according to Attorney General Opinion 23-009.
- It covers the solar equipment, and your land and home are assessed as usual.
- Lynchburg’s older ordinance taxes certified solar equipment at 85% of assessed value, and it now applies mainly to larger systems.
- At Lynchburg’s 2025 to 2026 tax rate, a 9 kW system avoids up to $200.34 in property tax each year.
- The 30% federal homeowner credit ended December 31, 2025, and Appalachian Power’s 1:1 net metering credit remains in place.
The Virginia Solar Property Tax Exemption at a Glance
This table summarizes key facts about the Virginia solar property tax exemption for Lynchburg homes. Each point is explained in the sections that follow. Use it as a quick reference when you talk with the city or your installer.
| Question | Answer |
| What law creates it? | Va. Code § 58.1-3661(A), added by SB 686 (2022 Acts, Chapter 496) |
| What size qualifies? | 25 kW or less, measured as DC nameplate capacity |
| How much is exempt? | 100% of the solar facility’s value (“wholly exempt”) |
| Is it mandatory? | Yes, for every Virginia locality |
| How long does it last? | For the life of the qualifying system |
| What stays taxable? | Your land, your home, and the rest of your property tax bill |
| Who handles property tax in Lynchburg? | The City Assessor (values) and the Commissioner of the Revenue (exemptions and relief) |
| What pairs with it? | Appalachian Power net metering and your choice of financing |
What Is the Virginia Solar Property Tax Exemption?
The Virginia solar property tax exemption is a state law that takes qualifying home solar equipment off the property tax rolls. It works as a tax shield. It keeps your solar system’s value out of your taxable assessment.
The Law in Plain English
In 2022, the General Assembly passed SB 686. It added subsection A to Va. Code § 58.1-3661. Under that subsection, a solar facility of 25 kW DC or less, installed under the home and farm provisions of § 15.2-2288.7, is:
- A separate class of property. The system is classified apart from your home and land for tax purposes.
- Wholly exempt from state and local taxation. This protection comes from Article X, Section 6(d) of the Virginia Constitution.
It’s Mandatory and Permanent
Before 2022, each Virginia city or county chose its own solar tax break. Subsection A set one statewide rule for small systems. Every locality now applies it the same way.
In Opinion 23-009 (August 14, 2024), the Virginia Attorney General reached two conclusions. Localities must grant the exemption for systems of 25 kW or less. The exemption also stays in place for as long as the system qualifies.
For Lynchburg homeowners, the exemption rests on state law. It stays the same through every city budget cycle. That gives you a stable, predictable tax picture for your solar investment.
What the Exemption Covers
Covered:
- Solar panels, racking, inverters, and related equipment that make up the qualifying system
- The added value that equipment would bring to your assessment
Still taxed as usual:
- The land under or around the array
- Your home’s existing assessed value
- The rest of your property tax bill
Why Virginia Offers It
The exemption is one of several state policies that make home solar easier to adopt. Others include by right installation rules for homes and net metering. Together, they support Virginia’s clean energy goals.
Who Qualifies for the Virginia Solar Property Tax Exemption?
Three factors decide eligibility for the Virginia solar property tax exemption. They are the system’s size, the property’s zoning, and compliance with local rules. Each one is covered below.
The 25 kW DC Size Limit
The 25 kW cap is measured as nameplate direct current (DC) capacity. That is the combined rated output of your panels. Your installer’s equipment specification sheet lists this number.
Most home systems fall well under the limit. The five customer systems featured on Convert Solar’s website range from 6.48 kW to 17.2 kW. All five sit comfortably below 25 kW.
Property Types That Qualify
Subsection A covers solar facilities installed under subsections A or B of § 15.2-2288.7. Both subsections focus on systems that serve the property where they sit. In practice, that means two groups:
- Homes on residentially zoned property. This describes the typical Lynchburg homeowner.
- Rooftop systems on agriculturally zoned property. These can sit on a home or another building, such as a barn, and must serve that same property. Learn more about agricultural solar.
Every installation must meet local height and setback rules. It must also follow any historic, architectural preservation, or corridor protection district rules. These rules matter in Lynchburg’s historic neighborhoods.
Owners of mixed-use or commercially zoned property should confirm treatment with the city before signing a contract. Those zones fall under other provisions of § 15.2-2288.7. A short call to the city settles the question early.
Rooftop vs. Ground Systems
Both rooftop and ground systems can qualify. Virginia law permits ground arrays on residentially zoned property that meet height, setback, and historic district rules. Owners planning a ground array on agricultural land should confirm eligibility with the city first.
Solar Batteries
The statute defines solar equipment to include devices that store electric energy. The 25 kW test in subsection A focuses on the system’s DC generating capacity. A battery installed as part of your solar system is commonly treated as part of the system, and the City Assessor can confirm the details.
For solar installs, we recommend Tesla Powerwall 3, our general recommendation, plus Enphase IQ Battery 5P and Enphase IQ Battery 10C. One battery is generally enough to power critical loads during power outages. Whole-home backup generally requires at least two batteries, depending on your usage and goals.
Battery storage systems generally start around $18,000. Final pricing depends on equipment, system design, installation complexity, and your energy needs. Battery warranties generally range from 10 to 15 years, depending on the manufacturer and product. Compare your options in our guide to battery backup.
Leased and Financed Systems
A financed system you own is treated like any homeowner system. With a Convert Solar lease, Convert Solar owns the equipment. Subsection A is written around the solar facility itself. Our team walks lease customers through how property tax applies under their specific agreement.
Systems Above 25 kW
Systems above 25 kW fall under Lynchburg’s local ordinance, covered in the next section. They also fall under separate state rules that phase exemptions in stages. Large projects, like Brightfields Solar on former coal mines, follow their own tax framework. Farm and business owners can explore commercial solar for larger systems.
Lynchburg’s Local Solar Ordinance vs. the State Exemption
Lynchburg adopted its own solar tax rule years before the Virginia solar property tax exemption existed. City Code § 36-154 makes certified solar equipment a separate class of property taxed at 85% of its assessed value. That figure comes from the University of Virginia Weldon Cooper Center’s statewide inventory of local solar exemptions. It works as a partial exemption.
| Virginia statewide exemption | Lynchburg local ordinance | |
| Legal source | Va. Code § 58.1-3661(A) | Lynchburg City Code § 36-154 (adopted under § 58.1-3661(B)) |
| Who it applies to | Qualifying home and agricultural rooftop systems of 25 kW DC or less | Certified solar equipment outside the state exemption |
| Exemption level | 100% | Partial (equipment taxed at 85% of assessed value) |
| Who sets it | State law, mandatory for every locality | City Council, by ordinance |
| Duration | For the life of the qualifying system | Set by local ordinance and state law |
For a typical Lynchburg home system of 25 kW DC or less, the state’s full exemption applies. You keep the full benefit automatically under state law. The local ordinance mainly affects larger systems and those outside the state exemption.
How to Confirm Your Solar Tax Exemption in Lynchburg
State law declares qualifying systems wholly exempt under the Virginia solar property tax exemption. Virginia’s administrative rules route solar exemption certification through local building departments, and local procedures vary. Confirming how your system is recorded is the safest step. These five steps keep your solar tax exemption in Lynchburg on track.
- Confirm your DC nameplate rating. Find the total DC kW on your specification sheet or contract. Make sure it is 25 kW or less.
- Close out permits and inspections. Your system should have passed every required building and electrical inspection with the City of Lynchburg.
- Contact the city. Reach the City Assessor’s Office, which values property, or the Commissioner of the Revenue, which administers exemptions. Both are at Lynchburg City Hall, 900 Church Street. Ask whether any certification or application is required and how your solar equipment is coded on your parcel.
- Review your next assessment notice. Lynchburg mails notices showing your property’s assessed value. If solar equipment value appears, raise Va. Code § 58.1-3661(A) and Attorney General Opinion 23-009 with the Commissioner of the Revenue.
- Keep your records organized. Use the checklist in the next section.
Documents to Keep for Your Solar Tax Exemption
Keep these records in one place, both digital and paper:
- Signed installation contract or lease agreement
- Equipment specification sheets showing the DC nameplate rating
- Building and electrical permits
- Final inspection approval from the City of Lynchburg
- Appalachian Power interconnection approval and permission to operate
- Invoices and later service records
These records also help with homeowners’ insurance claims after severe storms. A complete file makes any claim faster and simpler. It also gives the city everything it needs if questions come up about your exemption.
How Much Does the Exemption Save Lynchburg Homeowners?
The Virginia solar property tax exemption saves the tax the city would otherwise charge on your solar equipment. The math is simple. Here is the formula for Lynchburg solar property tax savings:
Assessed value of solar equipment ÷ 100 × Lynchburg tax rate = annual tax avoided
Illustrative Example
| System size | Installed cost at $2.65/W | Maximum annual tax avoided at $0.84 per $100 |
| 6 kW | $15,900 | $133.56 |
| 9 kW | $23,850 | $200.34 |
| 12 kW | $31,800 | $267.12 |
Basis for these figures: This example is for illustration only. It is a demonstration and represents neither a quote nor a tax determination.
- Cost: The example uses the approximate average installed cost of residential solar in Virginia as of July 2026. That figure is $2.65 per watt before incentives, based on EnergySage Virginia data.
- Tax rate: It uses Lynchburg’s property tax rate of $0.84 per $100 of assessed value for the 2025 to 2026 tax year, as published by the City Assessor. The city may adopt a new rate in future years.
- Upper bound: It treats the full installed cost as added assessed value. Assessors often value equipment at a fraction of its installed cost, and that value declines with age.
The Honest Takeaway
The exemption works as a guarantee. For a typical home system, it prevents a tax increase of up to about $130 to $270 per year in the example above. It also gives you certainty that your panels stay off your tax bill for the life of the system.
Resale Value and Your Tax Bill
Solar can make a home more attractive to buyers. The value of your qualifying solar equipment stays out of your assessment while you own the home. You enjoy the upgrade, and your tax bill stays steady.
Virginia Solar Incentives in 2026: What Stacks With the Exemption
The Virginia solar property tax exemption works alongside other Virginia solar incentives and policies. Together, they shape the value of going solar in Lynchburg. Here is how each one fits.
The Federal Homeowner Tax Credit Has Ended
The federal Residential Clean Energy Credit (Section 25D) gave homeowners a 30% credit for solar and batteries. That credit ended on December 31, 2025, and applied to systems installed by that date. State benefits, including this exemption and net metering, now make up a larger share of the value for Lynchburg homeowners.
Net Metering With Appalachian Power
Appalachian Power (APCo) serves most Lynchburg homes, so APCo’s net metering rules apply. Under net metering, the power your panels send to the grid earns credits. Those credits offset the power you draw later.
In August 2025, Virginia’s State Corporation Commission (SCC) ruled on APCo’s proposed net metering changes in Case PUR-2024-00161:
- Kept: New solar customers earn full retail credit (1:1) up to their annual electricity usage, with annual 12-month netting.
- Changed: Net excess generation above your annual usage earns a lower avoided cost rate of 5.66 cents per kWh at the time of the ruling.
- Protected: Existing APCo net metering customers keep their current terms. Low-income customers can choose either program.
Sizing matters for this reason. A system designed around your home’s electricity usage and your roof’s solar production captures the full 1:1 credit. Home rooftop systems connect through APCo’s net metering process, while large utility projects face PJM delays.
Financing Options
You can pay cash, finance a system you own, or lease a system through Convert Solar. Each option suits different households. The best choice depends on your budget, goals, and home plans. Convert Solar’s Virginia financing options include cash, loans, and solar leases; PPAs are not offered in Virginia.
The Bigger Energy Picture
Statewide policy and regional grid issues both influence electricity costs in Virginia. Our article on the RGGI debate explains one of the biggest policy questions facing Virginia ratepayers. It offers useful context for Lynchburg homeowners planning ahead.
Keeping Your System Eligible Over Time
The exemption follows a working, qualifying solar system. Good care protects your savings and your tax status. A few simple habits keep yours in good standing:
- Keep it in service and maintained. Routine checks protect your production and your records. Our maintenance checklist covers the basics.
- Plan for the cold months. Learn about winter performance and follow simple winter prep steps.
- Use your warranty. Convert Solar systems include a 25-year bumper-to-bumper warranty covering materials and workmanship, plus a separate 10-year roof penetration warranty. Learn more about our warranty service.
- Tell the city about major changes. Contact the Commissioner of the Revenue if you remove your system or expand it toward or past 25 kW DC. This keeps your property classified correctly.
Going Solar in Lynchburg With Convert Solar
You’re already paying for power. Did you know that you could pay less? Convert Solar has served homeowners for 14 years and has installed 8,500 systems across Virginia and Maryland. Today, our Lynchburg solar team serves homeowners across the Hill City.
- NABCEP-certified installers. NABCEP is an independent certification for solar professionals.
- Top Solar Contractor for six consecutive years (2021 to 2026). Solar Power World, a solar industry trade publication, has listed Convert Solar every year since 2021. In 2026, we ranked #22 Top Residential Solar Contractor and #25 Top Solar Installer in the United States. The rankings are based on the previous year’s installed solar capacity, so they reflect completed projects.
- Premium equipment. We install panels from leading North American and European manufacturers, including Silfab, REC, and Mission Solar, with Enphase inverters.
- Clear timelines. The average time from signing to installation is 6 to 8 weeks. The installation itself usually takes 1 to 3 days on site.
- Flexible financing. Choose from cash, financing, or a solar lease.
- Storage options. Explore our battery options for backup power.
Every home has a unique situation. The right system depends on how you live, how you use energy, and what your roof can support. General usage information is enough to get started.
Bring your electric bill and your questions. We’ll help you see which option fits your situation and what solar could save you. Request a free quote or explore residential solar.
Frequently Asked Questions About the Virginia Solar Property Tax Exemption
Will solar panels raise my property taxes in Lynchburg?
Qualifying systems of 25 kW DC or less are wholly exempt under Va. Code § 58.1-3661(A). Their value is not included in your taxable assessment. Your home and land are assessed as usual.
Is the exemption automatic, or do I need to apply?
State law declares qualifying systems wholly exempt. Virginia routes solar exemption certification through local building departments, and procedures vary by locality. A quick call to the City Assessor or the Commissioner of the Revenue confirms how your system is recorded.
What is the system size limit for the full exemption?
The limit is 25 kW, measured as DC nameplate capacity. Your equipment specification sheet lists this number. Systems above 25 kW fall under Lynchburg’s local ordinance or separate state rules.
Does the exemption cover ground arrays and solar batteries?
Ground arrays on residentially zoned property qualify when they meet height, setback, and historic district rules. A battery installed as part of a solar system is commonly treated as part of the system. The City Assessor can confirm how your battery is classified.
How long does the exemption last?
The exemption lasts for the life of a qualifying system. Attorney General Opinion 23-009 concluded that localities must grant it and keep it in place. State law provides that protection, so it remains steady through every city budget cycle.
How much property tax does the exemption save in Lynchburg?
At the 2025 to 2026 rate of $0.84 per $100, a 9 kW system costing $23,850 avoids up to $200.34 per year. That figure treats the full installed cost as assessed value, so it is an upper bound. Your savings depend on your system’s assessed value and the city’s current tax rate.
How do leased systems work with the exemption?
With a Convert Solar lease, Convert Solar owns the equipment. Subsection A is written around the solar facility itself. Our team walks every lease customer through how property tax applies under their agreement.
Is solar still worth it in Lynchburg after the federal credit ended?
The 30% federal homeowner credit ended on December 31, 2025. The property tax exemption and Appalachian Power’s 1:1 net metering credit remain in place, up to your annual usage. A free assessment from Convert Solar shows whether solar fits your home, usage, and budget.
Why choose Convert Solar for a Lynchburg solar project?
Convert Solar brings 14 years of experience and has installed 8,500 systems across Virginia and Maryland. Our NABCEP-certified installers and six consecutive years on Solar Power World’s Top Solar Contractors list reflect consistent installation performance. Every system includes a 25-year bumper-to-bumper warranty covering materials and workmanship, plus a separate 10-year roof penetration warranty.
